The Annual Employment Mix of Workers and Firms and the Part-time Earnings Gap in New Zealand

In this paper we document patterns of annual employment across jobs, workers and firms, and examine the relationship between these patterns and job-level earnings rates using data from Statistics New Zealand’s Linked Employer-Employee Database (LEED). First, we characterise workers’ annual employment along the intensive (or full-time, within month) and extensive (or full-year, across months) dimensions, and firms’ mix of full-time and full-year jobs. We use this characterisation to describe the nature of employment matching between workers and firms, and find that part-time workers are overrepresented in firms with a lot of part-time work. Second, we examine the relationship between the intensive and extensive margin characteristics of jobs and their earnings. Although there is a strong raw earnings penalty associated with part-time jobs, we estimate only a modest direct part-time impact on earnings after controlling for other worker and firm factors; and we estimate a part-year earnings premium.